Company history

On 7 July 1962 Iida Makoto, aged twenty-nine, and Toda Juichi registered Japan Guard Services in Tokyo with capital of $16,667 (¥6m) and five employees. There was no industry to join: in postwar Japan the police kept order at no charge, and the idea that a company would pay money for safety had no purchase. Iida was the third son of a sake wholesaler in Akasaka, a trade in which collecting on an invoice took months, and he had gone looking specifically for a business that was paid in advance — which led him to the private guarding already working in Europe and America. He was blunt about the motive: “there was nothing lofty about it,” he said later, “only a headstrong determination to be independent at any cost” (日経ビジネス, 6 August 1973). First-year sales were negligible.

The Tokyo Olympics of October 1964 changed that. Japan Guard Services handled the athletes’ village and other venues on its own — partly because almost no other private firm existed to bid — and the contract gave the whole idea of paid security its first public legitimacy. By the end of 1965 corporate orders were pouring in. But manned guarding scales only with headcount: every new contract needed more guards, payroll rose in lockstep with sales, and by the end of 1966 the company had some 790 people and still could not hire fast enough. Growth was capped by the labour market, not by demand.

Iida’s answer, in June 1966, was SP Alarm — Japan’s first online security system, in which sensors detected an intrusion, reported it down a dedicated line to a monitoring centre, and a response crew was dispatched. Crucially the equipment was never sold outright but rented on five-year contracts against a deposit, so revenue accumulated as long as the customer stayed. When the 三億円事件 — the ¥300 million robbery in Fuchu, December 1968 — drew the obvious criticism that machines cannot stop a crime, Iida drew the opposite conclusion and in 1969 ordered his salesmen to take no orders other than unmanned. Unmanned work was then 0.5% of sales; by 1972 it was 55%, and close to 60% a year later. Ten years in, sales were about ¥8.2 billion. The company listed on the second section of the Tokyo Stock Exchange in June 1974 with 250 alarm bases nationwide, 3,300 staff and sales of $37.5M (¥11bn), still compounding above 30% a year.

The machine model travelled. A tie-up with Taiwan Secom in January 1978 opened the overseas business, the shares moved up to the TSE first section that May, and a joint venture with Korea’s Samsung group followed in March 1981 (later renamed S1), then Thailand in 1987, Britain in 1991 and a Chinese holding company in 1992. At home the industry it had invented was now crowded — roughly 4,000 security companies by the late 1980s — but only two of them, Japan Guard Services and Sohgo Security Services, cleared ¥10 billion in sales. Electronic security demands patrol crews standing by across the whole country to answer an alarm, and only firms of scale could carry that overhead. By 1997 Secom alone took about a tenth of the industry’s revenue.

The consumer market was the hard one. My Alarm, Japan’s first home security system, launched in January 1981, and then almost nothing happened. A showroom opened in Jiyugaoka in 1988 drew no customers at all who had come looking for security; on cold calls, housewives did not recognise the name “Secom” and often mistook it for a consumer-finance lender. It took thirteen years to reach 50,000 cumulative contracts. The company stayed in anyway, and because rivals did not follow for roughly two decades it had the field effectively to itself — which is why, by the early 2000s, it held about 80% of household security and 60% of commercial electronic security, adding 35,000 contracts a year. Article 4 of Iida’s “Secom Constitution” had made the logic explicit: a service prepared ahead of society will meet resistance at first, and that resistance is precisely why it is worth choosing.

In December 1983, over strong internal opposition, Japan Guard Services renamed itself Secom. The point was not branding but permission. Cash from the rental contracts was piling up, yet a company called a guard firm could only sell into crime and fire prevention; the same national footprint, monitoring centres and dispatch crews could serve medicine or insurance if the label allowed it. Iida declared the company a “social systems industry” dedicated to a safe and convenient society, and in December 1986 set up the Secom IS Laboratory to work on AI and other base technologies — groundwork that justified, inside and outside the firm, what came next. In 1989 Secom bought the American home-care company HMSS for its home-infusion technology; in June 1991 it opened a pharmacy with a sterile compounding room and began supplying drugs to patients on home drips, together with a visiting-nurse service. Japanese law reserved hospital ownership to non-profits, so the entry had to be made at the margins, and the sums involved were tiny — about ¥300 million against group sales of $992.5M (¥134bn), nearly three-quarters of which still came from electronic security.

On 1 December 1991 Secom split the group into five equal divisions — security, peripheral businesses, information processing, overseas and medical — each under its own dedicated director. It did this in the middle of twenty-eight consecutive years of record sales and profit. The move deliberately demoted security from its status as “the main business” and handed it to president Komine Ken’ichi as one division among five, freeing it from group strategy. The real target was the founder: group strategy meetings tended to become an audience for chairman Iida whenever the subject strayed from security, and every new venture had come to hinge on his judgement. “Don’t keep relying on me,” was how he framed the reform — an attempt, as he put it, to make his own management progressively thinner. He stepped down as representative director in 1997, saying that “a founder carrying on until he dies is not a good way to hold a funeral,” having reckoned it would take five or six years for the organisation to acquire the habit of deciding without him. It did not entirely work: directors still came to him with the important files, and inside the company he was called “the boss” for another two decades.

Medicine was the long bet. In 1992 Secom took on the rescue of Kugayama Hospital, near collapse after years of loose management, installing its own employee Yoshida Seiji as chairman and turning the finances around — a case that forced open the debate about separating medical practice from business management. When the Ministry of Health allowed corporations to employ nurses in 1994, Secom set up Secom Home Medical Systems that April and moved its nurses across. The economics were dismal: connecting a catheter by anyone other than a doctor was illegal, few doctors were interested, and against a three-year goal of 500 patients the company had 99 at the end of May 1994. Politics were worse — when it tried to name a hospital it had bought out of bankruptcy “Secom Chiba Hospital” in 1998, the Japan Medical Association and the ministry forced a change. From then on Secom kept its name off the door, leasing land and lending balance-sheet support to hospitals useful to its home-care business while declining to send directors or take equity.

The rest of the decade was opportunistic in a way Iida cheerfully admitted to. In September 1998 Secom took 34% of the small non-life insurer Toyo Fire & Marine for $11.7M (¥2bn) — chosen precisely because a small book meant low expense ratios and no bad assets — and began selling policies through 850 branches alongside security. It picked up companies their banks had just written down: Shokusan Jutaku in March 1999, the aerial-survey firm Pasco for $131.8M (¥15bn) that August, and the bankrupt Asahi Tatemono that September, each with a use — security-equipped apartments, satellite mapping fed into guarding. It sold as quickly as it bought, banking a $91.7M (¥12bn) gain on Tokyo Internet in October 1998. “Instinct matters,” Iida said. “We run a scavenger-fish operation.” In January 1999 he declared cyber security the second wheel of the cart beside physical guarding; monitoring of corporate networks began in 2000, and Coco-Secom, which tracked moving people and vehicles, in March 2001.

By the year ended March 2004 the model had matured into something close to a monopoly: consolidated sales of $4.9B (¥532bn) and ordinary profit of ¥77.3 billion, both records, with the parent company having grown revenue for forty-one consecutive years. Secom held roughly 60% of commercial electronic security and 80% of household security. The year before, the medical business had turned its first profit, leaving every segment in the black. The hospital strategy had by then spread nationwide by stealth — a debt guarantee of over ¥10 billion helped Hokkaido’s Keijinkai buy out hospital property from the failed Nippon Lease, and by 2004 some thirteen hospitals with about 4,500 beds and 1.6 million patients a year were supported by Secom land or Secom credit, with no equity and no directors, while the company waited for the law on corporate hospital ownership to change.

From the mid-2000s the acquisitions had a consistent logic: buy the labour-intensive work that machines cannot yet replace, and attach it to the monitoring network. Nohmi Bosai, a listed fire-protection maker, was consolidated in December 2006; Japan’s first PFI prison opened at Mine in April 2007 with Secom running its security and support functions (the contract ended in March 2025); Nittan and the data-centre operator AT Tokyo followed in 2012; the small-lift leader Kumalift and the cash-in-transit leader Asahi Security in 2015; the BPO firm TMJ in 2017; Secom Tosec in 2018; the crowd-and-aviation-security specialist Senon in 2022; and a stake in the telecoms carrier Arteria Networks in 2023. Running the other way was a steady programme to take people back out of the work — the Secom Drone, the world’s first private-security autonomous surveillance drone, in December 2015; 3D security planning in 2016; Home Security NEO in 2017; a virtual guard rendered by an AI character and the cocobo security robot in 2022; the AI patrol drone Secom Drone XX in 2023.

The founder’s shadow reasserted itself in May 2016, when the board removed chairman Maeda Shuji and president Ito Hiroshi outright — after four straight years of record net profit — on a 6-to-11 vote, with the nomination committee itself divided. The incoming president Nakayama Yasuo, a Bank of Japan alumnus, explained that Maeda’s seven years of forceful leadership had cost the company its openness; Iida, then eighty-three and nineteen years out of executive office, was still “the boss.” The numbers since have posed the sharper question. Consolidated sales first passed ¥1 trillion in the year ended March 2019 at $9.3B (¥1.01tn) and reached $7.9B (¥1.26tn) by March 2026, but operating profit has barely moved — ¥142.8 billion in FY2019 against ¥144.2 billion in FY2024 — because the businesses bought are people-heavy. Security still supplies about 80% of group operating profit; overseas is only 5.8% of sales. President Yoshida Yasuyuki, in post since April 2024, has answered with three straight years of base-pay rises for security staff and, on the capital side, a two-for-one stock split in October 2024 and a buyback of up to $400.9M (¥60bn) in May 2025 — conceding, in effect, that adding businesses had stopped adding value per share.